Council adopts Neall plan to absorb loss of state Social Security tax aid

January 05, 1993|By John Rivera | John Rivera,Staff Writer

The County Council last night adopted Executive Robert R. Neall's plan to make up for $15 million in state aid cut by the legislature.

The state reduction in November ended a program that paid Social Security taxes for local teachers, librarians and community college employees. The aid cut, which Gov. William Donald Schaefer said he needed to help eliminate a $450 million deficit in this year's budget, was retroactive to the current fiscal year, making last night's vote necessary.

The county is required to present a payment plan to the state Board of Public Works by Jan. 15. It had the option of either paying the entire amount in one lump sum or in three equal payments.

Budget Officer Steven E. Welkos said he was making the payments as late in the year as possible "so we have minimal loss in investment income."

He said the money comes from a $5 million school surplus, a $5 million surplus in the county's general fund and $5 million to $6 million saved by delaying some capital projects.

Under Mr. Neall's plan, the first payment of $5.1 million on March 30 will come from the Board of Education in the form of money from the state's APEX fund -- a program begun by the state to increase its contribution to local school districts. The other two payments of about $5.1 million each would come from local income tax revenue; one payment is due May 31, the other on June 30, the end of the fiscal year.

In return for the school board's approval of this payment, which came at its Dec. 16 meeting, Mr. Neall promised to give the board more control over its budget.

Specifically, he agreed to give the board a fixed amount of money for education and let members decide how to spend it. In addition, the board could keep any increase in state or federal aid.

In the coming years, the schools' portion of Social Security taxes will be included in the annual budget.